Interim results for the six months ended 31 March 2019 Group revenue increased by 3.4% to GBP 8.3m

Benchmark reports encouriging H1 results, despite difficult market conditions

Benchmark Holdings has reported that the Group delivered growth in revenue and Adjusted EBITDA in the six months ended 31 March 2019, despite difficult conditions in the global shrimp and Mediterranean seabass/bream markets.

In addition, the UK-headquartered genetics, animal health and advanced-nutrition said substantial progress was made against the Group's strategic priorities including its next generation sea lice treatment, its specific pathogen / disease resistant (SPR) shrimp and the prioritised development of its pipeline of products.

Benchmark Advanced Nutrition feed (Photo: Benchmark)

The interim results for the six months ended 31 March 2019 show the Group revenue increased by 3.4% to GBP 8.3m (H1 2018: GBP 75.7m) driven by revenue growth in Animal Health, Genetics and all other segments (Knowledge Services) of 73%, 8% and 11% respectively. This was offset partially by revenue falling in Advanced Nutrition by 7%.

Adjusted EBITDA (earnings before interest, tax, depreciation, amortisation, impairment, exceptional items and acquisition related expenditure), increased to GBP 7.5m (H1 2018: GBP 6.0m). The increase arose principally from increased sales, positive movement in biological assets and a shift in mix towards higher margin products across the business. This was offset by the reduction in contribution from Advanced Nutrition as a result of challenging market conditions and by an increase in operating expenses related to the strengthening of management to ensure delivery of key strategic priorities.

Consolidated Statement of Cash Flows for the 6 months ended 31 March 2019 (Benchmark) | Click on the image to enlarge it

The Group is implementing a programme of structural and operational efficiencies to reallocate capital towards its key aquaculture opportunities whilst maintaining strict cost control and active management of working capital in order to accelerate the path to profitability and free cashflow generation.

Benchmark said global demand for salmon continued to grow in the period resulting in stable prices and a favourable environment for salmon producers and for its  products. Global salmon production increased by c.5% during the period with strong growth in demand coming from the US and the Americas, China and South Korea.

Scottish Salmon farm (Photo: Benchmark)

In shrimp, the industry experienced low prices as a result of temporary overstocking following a record harvest in 2018. This led customers to reduce and delay production with an impact on demand for the Group's products.

In the Mediterranean, demand and prices for farmed sea bass and sea bream have been affected by the economic environment in Turkey, the major producing country, which has put pressure on farmers across the Mediterranean.

Primary geographical markets | Consolidated Statement of Cash Flows for the 6 months ended 31 March 2019 (Benchmark) | Click on the image to enlarge it

The company's Genetics division performed well with revenues and Adjusted EBITDA increasing by 8% and 73% to GBP 22.6m and GBP 4.9m respectively. The result was driven by increased volumes in salmon eggs, particularly from the recently launched disease resistant eggs and from an increase in the value of biological assets as a result of growing sales and increasing capacity at the Group's new land based salmon egg facility in Norway.

The division also benefitted from an increase in sales to Chile from Iceland following the launch of Benchmark Genetics Chile (BGC) under its joint venture with AquaChile.

Benchmark Genetics salmon fry (Photo: Benchmark)

Following the agreement with AgroSuper to exit the JV, Benchmark will, in the coming weeks, wholly own a standalone and established breeding facility in Chile where it will continue its work to develop local broodstock with high value genetic traits. In the short term, the Group will continue to export salmon eggs from its operation in Iceland to satisfy demand in Chile as it continues to develop its position in this important market.

Benchmark also highlighted that the opening of the Group's new state-of-the-art land-based facility in Salten, Norway has been well received by customers and will play an important role in the future growth and development of its genetics business.

Trials of its disease resistant shrimp continued to show good results in Asia and commercial scale trials are underway. During the period Benchmark commenced broodstock production at its facility in Florida, and continued to invest in its tilapia genetics programme.

[email protected]
www.seafood.media

Address:	Benchmark House, 8 Smithy Wood Drive,
City:	Sheffield
State/ZIP:	England (S35 1QN)
Country:	United Kingdom
Phone:	+44 (0)114 240 9939
E-Mail:	[email protected]
More about:

Print